Juiced unaffected as Acclaim files for liquidation
With debts of over $100m.
Publisher Acclaim has finally reached the end of the line - with a Chapter 7 liquidation request filed in New York State - but highly anticipated racing title Juiced will be unaffected by the closure, GamesIndustry.biz has learned.
Chapter 7 proceedings mean that the company's operations will be wound up and its assets sold off; the alternative possibility was that Acclaim would seek Chapter 11 protection, which would allow it to continue trading and give it a chance to reorganise its debts.
The full scale of Acclaim's financial troubles is revealed by the documents accompanying its Chapter 7 filing, which was made in the US Bankruptcy Court in Central Islip, New York, earlier this week.
The documents presented to the court list debts of over $100 million, less than a third of which can be attributed to the firm's debt to former lender GMAC Commercial Finance. It was the failure to negotiate a new credit deal after the GMAC deal expired that precipitated this fatal crisis for Acclaim.
Acclaim lists assets valued at between $10 million and $50 million in its documents, with the final value presumably to be decided by a liquidation auction of some description. However, this outline valuation suggests that creditors could see as little as under 10 cents to the dollar of the amounts owed to them by the bankrupt publisher.
Exact details of who is owed what are unclear, but it's thought that among the creditors are a number of development studios and some smaller publishers for whom Acclaim was handling titles in certain international markets.
However, GamesIndustry.biz has this afternoon learned that the eagerly anticipated street racing title Juiced will be unaffected by the bankruptcy of the publisher, as it was financed and managed by development funding firm Fund 4 Games.
F4G owns the rights to the title, rather than Acclaim, and will now simply seek a new publisher for the game, which was developed in the UK by independent studio Juice Games.
The situation at Acclaim has been building for some months, ever since the firm announced yet another set of disastrous full year results and dropped the bombshell that its GMAC deal was reaching an end without a replacement deal in place. However, the full extent of the crisis only became clear last week, when the company first failed to meet its payroll obligations to UK employees for August - in many cases, electronic funds transfers were started and then later withdrawn by the firm - and then told staff at its various studio locations to go home and await further information.